17% of charities fear closure: Poll

One in six charities (17%) believe it is likely that public spending cuts and falling donations may force them to close next year, a survey has found.

Two-fifths (40%) fear their charitable organisation will fold if the economic situation does not improve, according to the online poll of 252 senior charity workers for the Charities Aid Foundation (CAF).

The dire outlook comes as just under half (49%) have had to dip into their reserves to stay afloat this year while more than a quarter (26%) have cut frontline services and one in four (25%) have shed staff.

John Low, chief executive of the Charities Aid Foundation, said: "Times are tough and people have less money to donate to charities.

"This, combined with significant public spending cuts and increased demand for charity services, is having a shocking effect on many charities, calling into question their very viability.

"Many organisations are having to dip into their reserves, cut vital frontline services and some are even concerned about whether they can survive in these toughest of times."

The foundation called on the Government to ensure public bodies do not "disproportionately" cut funding for charities when making savings.

A Cabinet Office spokesman said: "We know it is a very challenging environment for charities, especially for those previously dependent on taxpayer funding, but the sector cannot be immune from cuts.

"The Government is committed to strengthening the sector through programmes such as the £10 million Investment and Contract Readiness fund and the £65 million Advice Services Transition Fund.

"Furthermore, we have introduced new ways for the sector to finance itself through Big Society Capital, capitalised with £600 million, giving charities access to affordable loans and investment to grow, so they can do more."